SAN FRANCISCO, Oct. 25 /PRNewswire-FirstCall/ -- Further expanding its
line of integrated banking products, Charles Schwab Bank today introduced
Schwab Pledged Asset Mortgage, a new product that enables borrowers to use
their stock portfolio as collateral for buying a home.
Schwab Pledged Asset Mortgage leverages eligible securities in a client's
investment portfolio as an additional guarantee for a mortgage loan, rather
than necessitating the sale of stock for a down payment. Applicants must have
at least $250,000 in assets and meet other requirements to qualify.(i)
"Our clients have told us they want to be able to buy a home without
having to liquidate assets and alter their investment strategy -- and we've
responded," said Richard Musci, Chief Lending Products Officer Charles Schwab
Bank. "Schwab Pledged Asset Mortgage can be a valuable tool for investors
looking to leverage stock investments to purchase a second home, retirement
property or help their children with a down payment on a first home."
Schwab Pledged Asset Mortgage provides up to 100 percent home financing.
Upon approval of the mortgage and corresponding Pledged Asset Account, the
prescribed amount of eligible securities are transferred into a separate
Pledged Asset Account where the funds are held during the term of the loan.
Clients have access to their Pledged Asset Account and can execute trades.(ii)
Among the Schwab Pledged Asset Mortgage's benefits:
-- Clients can avoid potential tax implications of liquidating
investments to meet a down payment requirement.*
-- Clients do not incur an interest rate premium or private mortgage
insurance requirement since the pledged assets are made in lieu of a
-- Choice of a range of adjustable-rate mortgages.
-- Clients can continue to invest in eligible securities according to
their preferred investment strategy, with certain restrictions.
"At Charles Schwab Bank we strive to provide the highest level of service
and products for our clients, and the Pledged Asset Mortgage is another
example of how we are working towards a more integrated service model," said
Musci. "We encourage investors to talk with their financial advisor or call a
Schwab Bank Loan Consultant to understand if Schwab Pledged Asset Mortgage is
appropriate for their situation."(iii)
The Pledged Asset Mortgage from Charles Schwab Bank may only be used for
properties located in approved states. For more information or to apply for a
Charles Schwab Bank Pledged Asset Mortgage, consumers should speak with a
Schwab Bank loan consultant, Schwab Private Client consultant or a Registered
Investment Advisor working with Schwab Institutional or call 1-800-619-9937.
Terms and conditions apply.
About Charles Schwab Bank
Headquartered in Reno, Nevada, Charles Schwab Bank, N.A. provides
checking, savings, money market and CD accounts, home mortgages, ATMs,
credit cards and debit cards. Deposits are FDIC-insured. Clients can access
bank services at the banking office in Reno and by phone, mail or
www.schwabbank.com, and get information about the Schwab Bank Visa credit card
from Schwab Investor Centers. Charles Schwab Bank, N.A. is a subsidiary of The
Charles Schwab Corporation. Charles Schwab Bank, N.A. is an Equal Housing
* Charles Schwab and Co., Inc. does not provide tax advice or specific
information on tax issues. Mortgage interest may not be deductible if tax-
exempt obligations are pledged as additional collateral. Your clients should
consult a tax advisor regarding the deductibility of mortgage interest and
other tax consequences or benefits.
Loans are subject to credit and property approval. Some restrictions may
apply. Property and hazard insurance may be required. Loan terms are subject
to change without notice.
All the content contained in this material was prepared by Charles Schwab
Bank, N.A. (Member FDIC). Nothing herein is or should be interpreted as an
obligation to lend. Loans are subject to credit approval. Some restrictions
may apply. Charles Schwab Bank, N.A. and Charles Schwab & Co., Inc., are
affiliates of each other and are both subsidiaries of the Charles Schwab
Corporation. Charles Schwab & Co., Inc., a registered broker-dealer and
SIPC member, allows Charles Schwab Bank, N.A. to provide information about its
products as a convenience to Charles Schwab & Co., Inc.'s clients. Products
offered by Charles Schwab & Co. are not insured by the FDIC and are not
deposits or obligations of, or guaranteed or endorsed by Charles Schwab Bank,
N.A., and are subject to investment risk including possible loss of
principal. Charles Schwab & Co., Inc., does not solicit, offer, endorse,
negotiate or originate any mortgage loan products, and is neither a licensed
mortgage broker nor a licensed mortgage lender. Rates and terms are subject to
change without notice. Charles Schwab Bank, N.A. is not acting or registered
as a securities broker-dealer or investment advisor.
Charles Schwab Bank, N.A. Equal Housing Lender (Member FDIC).
(i) To qualify for the Schwab Pledged Asset Mortgage, clients must
meet certain loan requirements. Securities pledged must be
held in an account at Charles Schwab & Co, Inc. In addition to
holding liquid assets greater than $250,000, clients cannot
pledge more than 60 percent of their liquid assets and cannot
pledge retirement assets or volatile securities such as options
and low-value stocks
(ii) Certain trading restrictions may apply
(iii) The NASD identifies the following risks associated with a
Pledged Mortgage and Pledged Asset Account.
-- Even after you obtain your mortgage, you may be required
to deposit additional securities or cash to meet a
maintenance call if the value of the securities you
pledged falls below the minimum required.
-- Schwab Bank may force the sale of securities in your
account to meet a maintenance call or if the bank
reasonably determines that an adverse effect upon the
value of, or its interest in, the collateral is imminent,
and may do so without contacting you.
-- You are not entitled to choose which securities in your
account are sold, or an extension of time, to meet a
-- In the case of a Pledged Asset Mortgage, if you default on
your mortgage, you could lose both your house and the
securities you pledge.
SOURCE Charles Schwab Bank